The net direct tax collection during the first two months of the current fiscal fell by 47.93 per cent, mainly on account of dolling out of large refunds by the IT department. Net direct tax collections, gross collections minus refunds, were down by 47.93 per cent at Rs 12,954 crore during the first two months of the current fiscal, the finance ministry said in a statement.

The net direct tax collection was Rs 24,878 crore in the April-May period of 2010-11.

However, the gross direct tax collection during April-may went up by 37.34 per cent to Rs 50,405 crore.

The decline in net direct tax collection was on account of 217 per cent increase in tax refunds at Rs 37,451 crore. The same was Rs 11,824 crore in the April-May period of 2009-10.

The Central Board of Direct Taxes (CBDT) has provided a tax refund of Rs 11,824 crore in the April-May period of 2010-11 and Rs 73,000 crore in the entire fiscal.

“More than 40 lakh refunds had been issued in the current fiscal,” the statement added. Last fiscal, the IT department had made 85 lakh refunds.

The budget estimates for direct tax collections for the current fiscal is about Rs 5.33 lakh crore.